Collier County works to figure out how to get the 'next Hertz'

Aug. 5, 2013

Mike Reagen

Written by

Tim Nance

The decision has been in the books for months: Hertz Corp. is moving to Lee County.

But before picking a site on U.S. 41 in Estero in May, the car rental giant debated between Lee and Collier counties, among other locations. Both counties proposed incentives, but Collier’s package didn’t add up to what Lee was offering.

In addition to a slew of state perks, from tax abatement to reduced power rates, Lee County itself offered $4.6 million in aid and had recently reduced impact fees, significantly bringing down the cost of building the proposed 300,000-square-foot offices for its global headquarters.

Those involved with the process say it was never an overt competition, but in the weeks and months following the announcement, the Collier commission discussed what happened during meetings and workshops.

“So maybe some people don't think that it impacts a company like we just saw with Hertz. But, you know, we didn't discuss how others see Collier County. We need to see ourselves as others see us, in my opinion,” said Commissioner Tim Nance at a meeting on May 28. “You know, I would like to understand what impact fees Hertz would have had to pay in Collier County versus Lee County. Some people might not think it was of significance, but perhaps it is.”

Before breaking for the summer, the board instructed county staff to analyze a number of economic development tools that range from a public private partnership with the Greater Naples Chamber of Commerce aimed at business recruitment, to property tax abatement plans. The board will meet again in September.

Two tools that have moved to the forefront: impact fee reduction and economic incentives.

In a May 28 presentation to the board, newly hired office of business and economic development Director Bruce Register laid out his ideas for new incentives package. Using a hypothetical, he said a company looking to relocate its corporate headquarters to the area would have received $3,968,360 in incentives from Collier County, whereas Lee County could offer $4.6 million. This hypothetical company has the exact same stats as Hertz and was a thinly veiled comparison.

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Impact fees are the other development tool being discussed. In June, commissioners extended a reduction in impact fees for businesses moving into to older commercial buildings.This vote came about a month after a May 28 presentation by the county manager’s office that advocated for leaving impact fees alone, that the revenue is needed and construction is up.

Impact fees are charges on new development and are intended to pay for additional infrastructure and public services necessitated by the new construction. The idea is “growth pays for growth.”

Collier County has 12 impact fees for: transportation, law enforcement, community parks, water and sewer, regional parks, general government buildings, library, correctional facilities, emergency medical services, fire department, and schools. All told, these fees can pose a significant cost to companies looking to build in an area.

“Impact fees make a difference and in a competitive environment it’s definitely something companies look at, but it’s not everything,” said Mike Reagen, president and CEO of the Greater Naples Chamber of Commerce.

Collier County took in $22.9 million from the fees in 2012 and expected to make $20.6 million this year. Those numbers are well off the pre-recession amounts, which hovered around $100 million in 2006 and 2007, according to county figures.

Despite missing out on Hertz, business leaders say the process provided a valuable lesson for future regional cooperation for attracting and retaining businesses.

The Naples chamber and its subsidiary, The Partnership for Collier’s Future Economy, reached out to the Horizon Council, Lee County’s public-private partnership. The two, along with FGCU, formed the Regional Economic Development Initiative, known as REDI.

REDI is working on a website that would centralize information and promote the region to prospective businesses. It’s expected to go live in October.

“We’re all thrilled Hertz is coming here and I think it’s a prototype for working together in the future,” Reagen said.